Asia to receive 500,000-700,000 tonnes arbitrage naphtha supply

08 August 2012 08:54[Source: ICIS news]

SINGAPORE (ICIS)--?xml:namespace>Asia is estimated to receive 500,000-700,000 tonnes of naphtha in August and September, with the market expected to weaken further amid surplus inflows, traders said on Wednesday.

The spread between the second-half September and the second-half October contracts narrowed by 50 cents/tonne to $7.50/tonne (€6.08/tonne) in backwardation on Tuesday’s close, ICIS data showed,

The arbitrage material hails from northwest Europe and the Mediterranean, and is largely heavy naphtha in nature, they said.

However, some traders argued that demand for paraffinic naphtha is still firm, hence the supply-led fall in prices would be limited.